Adelphia Wants Court Approval for Worker
Payments

September 11, 2002 (PLANSPONSOR.com) - With employee
layoffs around the corner, Adelphia Business Solutions Inc.
has asked a judge's OK to pay $3.6 million in retention and
severance to some employees.

In papers filed with the US Bankruptcy Court in
Manhattan where Adelphia’s Chapter 11 reorganization case
is pending, the telecommunications company said the program
rewards employees for helping during the bankruptcy
proceedings and contributing to employee morale, a Dow
Jones news story reported.

Adelphia needs the approval of US Bankruptcy Judge
Robert Gerber. Gerber has scheduled a September 17 hearing
on the issue.

Adelphia recently opted to slash its operations and
workforce in light of the telecommunications industry’s
downturn.

Plan Details
The Dow Jones story reported these details of the plan from
court papers:

Adelphia estimates that 807 employees will be eligible
for severance payments as a result of the planned workforce
reductions. Under the company’s proposed severance plan,
the total cost to the company would be about $922,000.

The company also estimates that $121,000 in bonuses
would be paid to about 145 of these employees for providing
transitional services to complete the orderly shutdown of
closed and mothballed markets.

The company said the plan would reduce the number of
weeks of severance payments to which some employees might
otherwise be entitled. Historically, the company said it
paid monthly severance payments for a period ranging
between three and 26 weeks, depending on length of
service.

The proposed retention plan would split $900,000 among
18 employees who have been identified as critical or key to
the company’s business and restructuring. Each employee
would be entitled to $120,000 or 20% to 50% of salary,
which would be paid over time in three installments.

The plan also sets aside $200,000 for select general
managers. These employees could receive up to $20,000 when
a reorganization plan for the company goes into effect.

Adelphia Business has also sought approval to pay $1.2
million in quarterly and year-end bonuses owed to 64
employees since March 27. Adelphia said the bonuses are a
regular component of certain employees’ compensation.

The company seeks court approval to pay up to $200,000
in bonuses for employees hired after October 1. Individual
bonuses would be capped at $15,000.

The issue of severance payments has also bubbled over
recently at WorldCom.